Climate Financing and FDI Impacts on Renewable Energy Consumption for Sustainable Development in BRICS+

Despite rising climate risks, developing economies struggle to secure adequate climate finance and attract foreign investment needed for clean energy transitions. This study examines how these two funding sources influence renewable energy consumption across ten BRICS+ countries from 2008 to 2020. We employ panel data estimation techniques to confirm the robustness of our findings. In addition, simple impulse response estimates (Local Projections) reveal how shocks to green technology patents and FDI unfold over time. Our findings show that both climate finance, proxied by green patents, and FDI independently raise renewable energy use. Yet, when combined, their interaction is consistently negative, suggesting that simultaneous inflows can overwhelm regulatory and institutional frameworks without targeted capacity building. This adverse effect diminishes in countries with more advanced renewables sectors, highlighting a stage‐dependent transition process. These results indicate that scaling up finance and investment must be matched with continuous training, streamlined permitting, and harmonised regulations to fully unlock synergies. For upcoming COP meetings, we recommend that BRICS+ nations adopt dual reporting, tracking both innovation outputs and deployment funding, and establish one‐stop coordination units to fast‐track project approvals. By providing support to each country's adoption in renewable development, policymakers can transform potential funding constraints into continued progress for achieving low‐carbon growth.